Ryanair threatens to reduce its Shannon base by 75%

RYANAIR has threatened to reduce its Shannon base by 75% – cutting its aircraft numbers from four to one – if the Government does not remove the controversial €10 tourist tax.

The low-fare airline is currently in talks with airport authorities about the terms for an extension of Ryanair’s five-year base agreement at Shannon, which runs out in April 2010.
Ryanair confirmed it has grown its annual traffic at Shannon from 300,000 passengers in 2004, to 1.9m last year, as agreed under the current deal which was signed in late 2004.
However, it said that the Government’s €10 tourist tax, introduced in April 2009, “continues to devastate traffic and visitor numbers at all Irish airports and Shannon in particular”.
Ryanair has already cut its Shannon base from six aircraft in winter 2008, to four in summer 2009, and is reducing the base further to three aircraft in winter 2009/10.
The airline, which says it has lost money in each of the five years it has operated a Shannon base, insists that it is “willing to continue to base aircraft and deliver substantial passenger numbers and jobs at Shannon” if the €10 tourist tax is removed before February and if Shannon Airport reduces Ryanair’s cost base costs by 50% over the terms of a new five-year agreement.
Deputy chief executive Michael Cawley reiterated Ryanair’s call on the Government to scrap the “stupid and damaging” €10 tax, in line with other European governments.
“The Belgian and Dutch governments have already realised the damage that these tourist taxes cause and have scrapped them,” Mr Cawley said.
Reacting to this latest threat, Deputy Joe Carey called on the Government to remove the travel tax during a private members’ motion in the Dáil on Tuesday night.
“The Government’s tourism advisory body recently called for the tax to be abolished. Ryanair and Aer Lingus speak with one voice on this and it is not often that they agree. They have stated forcefully that they want this travel tax scrapped. There is a consensus among Opposition deputies, airlines and those working on the ground that this tax should go.
“Shannon Airport is being hit really badly. The average cost of a Ryanair flight out of Shannon in the winter months is €10. The €10 travel tax being imposed by the Government is crippling the airport. The impact of this travel tax is felt by hotels, guesthouses, restaurants and shops right across the constituency, from Loop Head in West Clare to Whitegate in East Clare and from Ballyvaughan in North Clare to Killaloe in South Clare.
Further to this, Deputy Carey is hoping to secure an adjournment debate on the matter on Thursday and has repeatedly raised this issue.
Speaking on Wednesday, Deputy Carey stressed that this threat had to be taken seriously.
“While there is inevitably a certain amount of gamesmanship and negotiating tactics in these comments from Ryanair, there can be no doubt that the travel tax has been a disaster for the Mid-West region. It should be removed immediately,” he said.
Meanwhile,  management at Shannon Airport confirmed on Wednesday that it was in talks with Ryanair in relation to a possible extension of the airline’s existing five-year deal.
“Shannon Airport currently has a legally binding agreement with Ryanair, under which the airline receives the most competitive price that Shannon can offer,” said an airport spokesperson.
“The €10 air travel tax that applies to flights of more than 300 kilometres is a Government tax that is paid by the passengers of all airlines flying from Shannon Airport and the other main airports in the State. Shannon Airport has no role in the Government tax,” he explained.